Republic of the Philippines

HOUSE OF REPRESENTATIVES
Quezon City

FIFTEENTH CONGRESS
First Regular Session

HOUSE RESOLUTION No. 172

________________________________________________________________________
Introduced by Reps. TEODORO A. CASIÑO and NERI JAVIER COLMENARES

RESOLUTION
DIRECTING THE COMMITTEE ON GOVERNMENT ENTERPRISES AND
PRIVATIZATION AND THE COMMITTEE ON TRANSPORTATION TO
CONDUCT AN INVESTIGATION, IN AID OF LEGISLATION,
ON THE PROPOSED METRO RAIL TRANSIT (MRT) AND
LIGHT RAIL TRANSIT (LRT) FARE HIKES

WHEREAS, there are proposed fare hikes for the Metro Rail Transit (MRT) and the Light
Rail Transit (LRT) to as much as 60%. Department of Transportation and Communications
(DOTC) Undersecretary Dante Velasco was quoted as saying that the said fare hikes were
inevitable and that they are adopting a “users pay” concept instead of letting the government
subsidize ticket prices;

WHEREAS, MRT and LRT tickets cost around P11 to P15. According to reports, the real
cost of transporting train passengers is pegged at P60 to P65 a person. Under the “users
pay” concept, the DOTC is said to be studying increasing MRT’s fare to P25. A ten-peso
increase, equivalent to P20 per day, would further increase the daily spending of low-wage
earners for transportation, leaving less for food, shelter, education and other expenses;

WHEREAS, millions of commuters are depending on the MRT and LRT lines to get to
work or school every day. According to reports, MRT has 500,000 to 800,000 passengers a
day, LRT 1 has 500,000 and LRT 2 has 250,000;

WHEREAS, the point of public and mass transportation is to decrease congestion,

promote economic growth and lessen air pollution. Our railways, through their affordability,
have helped achieve the said objectives. Increasing ticket prices would most likely make
commuters opt to take buses or other forms of transportation, translating to more vehicles
clogging our major roads and more pollution;

WHEREAS, on January 18, 2010, former President Gloria Macapagal-Arroyo signed

Executive Order No. 855, directing the National Development Company (NDC), the
Department of Finance (DOF), the Department of Budget and Management (DBM) and the
National Economic and Development Authority (NEDA) to “review and amend the
existing BLT (Build Lease and Transfer) Agreement for the purpose of making the MRT 3
Project economically viable to the Government.” This midnight order/directive from the
former president clearly paves the way for the privatization of the system;
WHEREAS, President Benigno Aquino III emphasized public-private partnerships in his
State of the Nation Address which would mean the further entry and control of private
business into services and other sectors that primarily rest on government for delivery as
part of its duty to the people;

WHEREAS, government has adopted privatization as its escape hatch whenever it needs to
bail out its public utilities buried in debt due to poor management and/or corruption. The
experience with privatization has shown that privatized utilities bring about unregulated
price increases. It is feared that increasing fares will eventually lead to privatization and the
state’s abandonment of its duty to provide affordable mass transportation to the citizens;

WHEREAS, before proposing any increases, the high cost of operations and the large
amount of debt incurred by the project should first be investigated, specifically on whether
taxpayers are actually subsidizing debt incurred by the private consortium that built the
MRT. There is need for government to look into the operational costs of the MRT and LRT
lines to check if there might be excessive expenses or mismanagement of funds;

WHEREAS, ultimately, it is government’s responsibility to provide for or subsidize public

utilities like that of the MRT and LRT lines. Losses brought about by debt, corruption and
government crises should not be passed on to the public. The government should even
increase its subsidy to facilitate the purchase of more trains to accommodate more
passengers;

NOW THEREFORE BE IT RESOLVED, that the Committee on Government

Enterprises and Privatization and the Committee on Transportation jointly or separately
conduct an investigation, in aid of legislation, on the proposed Metro Rail Transit (MRT)
and Light Rail Transit (LRT) fare hikes.

Adopted,

REP. TEODORO A. CASIÑO REP. NERI JAVIER COLMENARES

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